Torkin Manes (Toronto/Ontario): COVID-19 Insurance Considerations: Business Interruption and Other Indemnity Opportunities

The COVID-19 pandemic is evolving hourly. At present, Ontario is in a state of emergency, and it is likely that most Provinces will follow suit. Extreme “social distancing” measures have taken hold nation-wide, and this has already caused dramatic consequences to businesses in almost every sector.

Some of our clients have been asking whether they will be entitled to insurance coverage for business interruption and related economic losses resulting from the COVID-19 climate. This is a nuanced and complex question, and we highlight some key considerations below.

Considerations for Potential Insurance Coverage

Whether or not your business will be entitled to insurance coverage for COVID-19 related losses will depend on an analysis of the specific terms and conditions of your policy, as well as its riders/endorsements. It will also depend on an analysis of the facts surrounding the circumstances of the loss, and how these apply to the policy wording.

Policies of commercial insurance can be dramatically different from one policy to another. Furthermore, the Declarations pages can often be confusing and difficult to decipher. We often see provisions for business interruption, accounts receivable, and product impairment buried in riders and endorsements which themselves can be difficult to interpret.

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